By Daniel Hunter
One in five adults lack confidence about personal finance, while a third feels uncomfortable talking about money.
The same proportion struggled to find the balance on a bank statement, identify the best ISA rate available or picking the best out of two discount prices on a financial product, such as a savings account.
According to research from the Money Advice Service, just over one in ten people believe that the Bank of England base rate is over 10%, when it is actually 0.5%.
Despite the lack of understanding about financial products, such as savings accounts and loans, more than four fifths of people said they keep track of their income and expenditure, while three fifths of current account holders check their balance online.
Four fifths take time to check their account balance before going shopping, suggesting that there is a desire to maintain control of outgoings. However, over one in ten said they don’t know how much is in their current account, within a £100 range.
The Money Advice Service survey of over 5,000 people also found that more than a third of people cut back on their spending in the run up to payday. Nine in ten adults are concerned about getting into debt. Only half of adults keep a personal budget.
“We found that when people do a little bit of planning and budgeting it has a dramatic effect; improving confidence and self-esteem,” said Guy Shone, head of customer and market insight at the Money Advice Service.
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